Income Tax (Earnings and Pensions) Act 2003 section 94

Benefit of credit-token treated as earnings

Section 94 explains how the benefit an employee receives from using a credit-token is calculated and treated as taxable earnings.

• Each use of a credit-token by an employee to obtain money, goods or services creates a taxable benefit treated as earnings for the tax year in which the token is used
• The taxable amount (cash equivalent) is the cost of providing the money, goods or services obtained, less any amount the employee reimburses by 6 July after the end of the relevant tax year
• The cost of provision means the expense incurred by the person who bears the cost of supplying the money, goods or services on each occasion the token is used
• Where credit-tokens are provided to a group of employees under a single arrangement, the total expense must be apportioned between them on a just and reasonable basis